Supercuts 2008 Annual Report Download - page 81

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
average common shares and common share equivalents outstanding, which includes shares issuable under the Company's stock option plan and
long-term incentive plan, shares issuable under contingent stock agreements, and dilutive securities. Stock-based awards with exercise prices
greater than the average market value of the Company's common stock are excluded from the computation of diluted earnings per share.
Comprehensive Income:
Components of comprehensive income for the Company include net income, changes in fair value of financial instruments designated as
hedges of interest rate or foreign currency exposure and foreign currency translation charged or credited to the cumulative translation account
within shareholders' equity. These amounts are presented in the Consolidated Statements of Changes in Shareholders' Equity and Comprehensive
Income.
The Company adopted SFAS No. 158, Employers' Accounting for Defined Benefit Pension and other Postretirement Plans
(SFAS No. 158)
during fiscal year 2007. SFAS No. 158 requires balance sheet recognition of the funded status for all pension and postretirement benefit plans.
SFAS No. 158 requires the impact of the initial adjustment of the ending balance of accumulated other comprehensive income.
79
Accumulated Other Comprehensive Income 2008 2007 2006
(Dollars in thousands)
Balance at July 1
$
78,278
$
58,066
$
46,124
Cumulative translation adjustment:
Balance at July 1
83,968
63,095
52,619
Pre
-
tax amount
28,804
20,873
10,476
Tax effect
(1,684
)
—
—
Net of tax amount
27,120
20,873
10,476
Balance at June 30
111,088
83,968
63,095
Changes in fair market value of financial instruments designated as cash flow hedges:
Balance at July 1
(6,249
)
(5,029
)
(6,495
)
Pre
-
tax amount
(3,811
)
(1,554
)
2,336
Tax effect
1,254
334
(870
)
Net of tax amount
(2,557
)
(1,220
)
1,466
Balance at June 30
(8,806
)
(6,249
)
(5,029
)
Recognition of deferred compensation (SFAS No. 158):
Balance at July 1
559
—
—
Pre
-
tax amount
(1,330
)
891
—
Tax effect
462
(332
)
—
Net of tax amount
(868
)
559
—
Balance at June 30
(309
)
559
—
Balance at June 30
$
101,973
$
78,278
$
58,066